Demsa

Rising interest rates means people looking to remortgage their homes will pay an average £2,900 a year more from 2024. The Resolution Foundation predicts the average two-year fixed rate deal will hit 6.25% later this year, leaving the UK in a "mortgage crunch". They predict that around 800,000 will re-mortgage in 2024. The typical rate rose to 5.98% on Friday, according to financial information service Moneyfacts, as more mortgage providers increased the cost of their home loans. They included 2… Read more

General update In April 2023, 27% of new clients cited the cost-of-living as their main reason for debt, up from 15% a year ago (April 2022). 58% were in arrears with their dual fuel bills. 62% of StepChange clients were women. For the fourth consecutive month, client volumes were higher than during the same month in 2022. In April 2023, 14,512 clients accessed full debt advice, which is 15% higher than April 2022 (12,629). Link: https://www.stepchange.org/media-centre/press-releases/cost-of-living-debt-driver.aspx UK Finance quarterly trends… Read more

General update Reduction in inflation in April 2023 - what is the time lag for indebted UK consumers benefitting from this (or not)? One of the aspects of taking "a healthy dose of cynicism” is that you are forever trying to balance positive and negative headlines with what that really means to the many people with problem debt and, from a horizon scanning perspective, when this will take effect. The Office for National Statistics (ONS) headline says that "CPI rose… Read more

In today’s bulletin General update FCA Financial Lives survey update Update on hybrid working Personal insolvency - England & Wales - April 2023 Reminder - Ofgem consultation a framework for consumer standards – closes 31 May 2023 AI & Automation in the Contact Centre Laying the groundwork for DORA compliance Training – next VRS Consumer Duty dates Events General update Good Energy Limited and OVO Energy Limited to pay £4m for overcharging customers As part of its compliance work, Ofgem… Read more

Bank of England raises interest rates to 4.5% Link: https://www.bankofengland.co.uk/monetary-policy-summary-and-minutes/2023/may-2023 As predicted the Bank of England has raised interest rates from 4.25% to 4.5%. The next review is 22 June 2023. CPI inflation was 10.2% in Q1 2023, but is expected to fall sharply in April 2023. On 5 May 2023, ONS published the latest data and trends about the cost-of-living crisis. This explores changes in housing costs and how this is affecting people, both private tenants and mortgage holders.… Read more

Ofgem consultation As a follow-up to last week’s bulletin and the speech by Jonathan Brearley at Ofgem, there is now a consultation on a framework for consumer standards and policy options to address priority customer service issues. Their stated priority as a regulator is to protect consumers, especially those who are vulnerable, by ensuring they are treated fairly. This feels like the lead up to Consumer Duty. They want to ensure that consumers in vulnerable situations have a dedicated method… Read more